Saturday, October 8, 2011

23 Things They Used to Tell You About Capitalism

Ha-Joon Chang has written a great little book called 23 Things They Don't Tell You About Capitalism. An engaging speaker, he recently presented the book at LSE - the podcast here is well worth a listen too.

Although it's important to make these arguments, and Chang does a great job of it, the dominant feeling I'm left with is dejection and frustration. Why? Because what Chang is arguing is almost self-evidently true, and should barely need saying. Indeed, 25-30 years ago much of what he argues in the book constituted the conventional wisdom. Yet the idea that markets are social constructs, that regulation is a politically loaded issue, that individual productivity is not really individual, have now become quite radical things to say.

Why? Well we know there has been a sustained assault on social democratic values over the past thirty years or so, and that has been largely successful in pushing back the frontiers of political intervention in favour of justice and fairness. But why hasn't the left fought back? Why instead have social democrats been forced onto the back foot, constantly conceding defeat and allowing the political centre to move ever-rightwards?

The reason is that the left has lost its anchor. The right can argue in favour of free markets, and can push for more 'freedom' in the knowledge that there is always a tax to be cut or a regulation to be abolished. The left, however, no longer has an objective to push towards. Instead it hangs on to what it has, and what it has is less and less as the right pushes the Overton window in its own direction.

The left has become the centre. The right, by pushing further in the direction of its most radical goals, is able to redefine continually what the centre means. The left, without its old anchor, is unable to resist being dragged reluctantly to ever more pro-market positions.

The answer has to be to find an anchor again. For me, that has to be equality. Policy has to deliver greater equality, or it's not worth pursuing. The time has come to put down some markers.